10 Crypto Scam Warning Signs: When Promises Don't Deliver ... Or Worse

With the crypto market seeing a rise in fraudulent schemes that promise guaranteed earnings and then fail to deliver, investors would do well to watch out for the signs of a scam project before investing their money.

To protect themselves from these scams, investors need to distinguish worthwhile projects from those that will result in significant losses.

• One of the main signs of a scam project is when the project team makes promises they cannot deliver. This might include guaranteed earnings that cannot be accurately predicted.

• Investors should be cautious when a project team is anonymous. A strong team is one of the factors that can determine the success of a project, and when it is not transparent, concerns can be raised about their credibility.

• Investors should also be wary of projects that have no technical documentation or working product. Even the most revolutionary idea without proper documentation of its technical solution is nothing.

• When a project announces a super large-scale project with a small team, it is hardly worth trusting.

• Another warning sign is when a project has a roadmap painted out for several years ahead.

Also Read: Silvergate Exchange Shutdown: Are Stablecoins Becoming The New Crypto Kings?

• The crypto market is very dynamic, and several peers may have already been released during that time.

• Investors should also be cautious if the team is allocated a large share of tokens. A team that wants to get 30% to 40% of the tokens, and loudly proclaims the high decentralization of the project, looks questionable.

• Low token prices might seem like a great potential for growth, but investors should pay attention to capitalization.

• Weak marketing is also a cause for concern, as even the coolest product can fail if nobody knows about it. If the project is absent from any social networks, it is already a very alarming sign.

• If investors are not clear on what the project does or if it hides information about competitors, they should avoid investing in that project. A good project should not be afraid of competitors, and if they are not mentioned in the documentation, that is a reason to think twice.

Read Next: White House Responds To Silvergate Collapse, Here’s What President Biden Wants Congress To Do

Photo: Panchenko Vladimir via Shutterstock

Image and article originally from www.benzinga.com. Read the original article here.